Elektroimportøren AS — Interim / Quarterly Report 2021

Aug 18, 2021

Elektroimportøren

An introduction to Elektroimportøren

• Provider of electrical equipment to B2B and B2C customers
• Disrupts the traditional value chain and distributes directly to end-customers
• Successful development and sourcing of own brand, Namron
• Proven omnichannel concept with a market leading online store and 24 stores across Norway
• Unique service offering through Spoton which connects private customers and installers

Elektroimportøren in brief Nationwide network of stores

2nd quarter presentation

Summary of Q2

• Revenue of 320,8 MNOK (271,9 MNOK) up 18,0%.
• Adjusted EBITDA of 39,6 MNOK (40,7 MNOK). Adjusted EBITDA margin percentage is 12,4% (15,0%). Provision for year end bonuses of 3 MNOK in Q2. No provisions was made in Q2 2020.
• Growth has continued in second quarter despite having to face tough comparables from last year, (up 40% in 2020) we managed to grow sales with 18%. Compared to 2019 sales are up 65%.
• Growth is driven by great sales in B2B where we have grown with 49%.
• Electrical vehicle chargers continue to be the fastest growing category.
• B2C sales have a slight decline of 2.3% where April and May were affected by store closures and ended with decline. June had good growth supported by a good new store opening campaign.
• We opened store number 24 in Jessheim on the 14th of June with good reception from our customers.
• Spoton has now been rolled out in all 24 stores, and we can now offer Spoton services to more than 70% of Norwegian households.

• Contract for one more new store signed, planned opening Q4 2021.

• Online ordering and inspection of electrical installation

• Why Spoton?
• Find electrician with the right competence
• Get installation done fast at the agreed time
• Fixed price on installation and material
• Easy, safe, fast

1H 2021

500+ installations and MNOK 4 in sales

ESG at Elektroimportøren

Revenues Q2

• Total revenue in Elektroimportøren for Q2 was 321 MNOK, increasing from 272 MNOK Q2 last year (18% growth. Like for like growth in physical stores was 10,9%, while growth in Online sales channel was 26,6% (collect in store is reported as part of sales in physical stores).
• B2B sales have increased with 49,0% compared to last year, while B2C sales had a small decrease. Largest driver for B2B growth is sales of EV chargers to installers.
• Some negative impact from some of our stores being closed for B2C customers during parts of Q2 due to Covid restrictions.

Gross margin for Q2

• Gross margin percentage of 37,4% was down from 39,8% last year. The percentage margin for B2C and B2B customers excluding Electrical vehicle chargers is at the same level as last year. Compared to Q1 the margin percentage is slightly improved.
• Key drivers for reduced margin year on year are the significant sales increase of EV chargers and increased sale to B2B customers.

OPEX

• Compared to Q2 last year we have two more stores, Klepp and Jessheim. Tønsberg opened in May last year.
• Sales channels Costs have increased from 44,0 MNOK to 50,5 MNOK. Costs as percentage of sales have a slight improvement from 16,2% to 15,7%.
• Other operating expenses were 29,8 MNOK an increase from 23,6 MNOK.
• Compared to last financial year we have started to make provisions for year end bonuses earlier in the year. No such provisions H1 2020.

Adj. EBITDA

Key financials Q2 - 2021

• Revenue of 320,8 MNOK (271,9 MNOK) up 18,0%.
• Online share of total sales (excluding pick up in store) 13,9% (13,0%).
• B2B sales have increased with 49,0% compared to last year, while B2C sales had a decrease with 2,0%. B2B share of total sales have increased to 53,1% (42,6%).
• Total like for like sales growth 13,0% driven by 26,6% online and 10,9% physical stores.
• Sale of Electrical Vehicle chargers have continued to increase significantly compared to last year. Total sales Q2 with 34 MNOK (6 MNOK). Even though this is a profitable product category, the overall margin percentage is significantly lower compared to other product groups.
• The overall Gross margin percentage of 37,4% was down from 39,8% last year. The percentage margin for B2C and B2B customers excluding Electrical vehicle chargers is at the same level as last year. Key drivers for reduced margin year on year are the significant sales increase of EV chargers and increased sale to B2B customers.
• Opex to sales ratio 25,0% (24,9%). For this financial year we have started to make provisions for expected year end bonuses. In 2020 we started to make provisions from Q3. Taken this into consideration we are still increasing cost efficiency year on year, even when we compare against Q 2 2020 where we had "positive" effects on total cost because of Covid.
• Adjusted EBITDA of 39,6 MNOK (40,7 MNOK). Adjusted EBITDA margin percentage is 12,4% (15,0%)
• Net cash as of June 2021 is 65,5 MNOK (2,8 MNOK). In addition we have a overdraft facility of 120 MNOK not utilized. This is a significant improvement year on year.

Outlook for the rest of 2021

• Confident in continuous sales and marketshare growth in B2B
• Expect B2C sales in LFL to be on par with last year.
• Electrical vehicle charger sales will keep its share of business
• Gross margins to be at the same level as 1H
• Continue to build market awareness of Spoton and sales around mnok 10 at the end of the year
• Signed one more store, opening in Q4
• Expansion of central warehouse
• Conclude on strategy for Sweden

Q&A

Appendix

Alternative Performance Measures

(Amounts in NOK million)	Q2 2021	Q2 2020	H1 2021	H1 2020	2020
Revenue	320,8	271,9	666,5	528,6	1314,9
COGS	$-201,0$	$-163,6$	$-417,8$	$-320,8$	$-792,5$
Gross Profit	119,8	108,3	248,7	207,8	522,5
Gross margin (%)	37,4%	39,8 %	37,3%	39,3%	39,7%
Operating expenses in sales channels	$-50,5$	$-44,0$	$-112,8$	$-99,5$	$-225,9$
Other operating expenses	$-29,8$	$-23,6$	$-63,8$	$-51,9$	$-134,9$
OPEX	$-80,2$	$-67,6$	$-176,6$	$-151,3$	$-360,8$
OPEX to sales margin	$-25,0%$	$-24,9%$	$-26,5%$	$-28,6%$	$-27,4%$
Adjusted EBITDA	39,6	40,7	72,1	56,4	161,7
Adjusted EBITDA margin (%)	12,3%	15,0 %	10,8%	10,7%	12,3%
Adjustments	0,3	0,0	$-0,5$	0,0	$-7,0$
EBITDA reported	39,9	40,7	71,6	56,5	154,7
EBITDA reported margin (%)	12,4%	15,0 %	10,7%	10,7%	11,8%
Depreciation	$-6,7$	$-5,4$	$-12,8$	$-10,8$	$-23,3$
Adjusted EBIT	33,0	35,3	59,3	45,6	138,4
Adjusted EBIT margin (%)	10,3%	13,0 %	8,9%	8,6 %	10,5%
Adjustments	0,3	0,0	$-0,5$	0,0	$-7,0$
Amortisation intangible assets	$-2,5$	$-2,5$	$-4,9$	-4,9	$-9,8$
EBIT reported	30,8	32,8	53,8	40,8	121,6
EBIT reported margin (%)	9,6%	12,1%	8,1%	7,7 %	9,2 %
Net financial expenses	$-1,8$	$-3,5$	$-4,2$	$-7,3$	$-14,4$
Profit before tax	29,0	29,3	49,7	33,5	107,2
Net Income	22,1	22,4	37,6	25,0	81,3
Liabilities to financial institutions	205,0	$-205,0$ -	205,0	$-205,0$	$-205,0$
Leasing liabilities (Autostore)	19,3	$-10,7$ -	19,3	$-10,7$	$-20,6$
Cash/Overdraft facility	65,5	2,8	65,5	2,8	94,1
Net interest bearing debt	158,8 ٠	$-212,9$ -	158,8	$-212,9$	$-131,6$

Consolidated statement of profit and loss

Amounts in nok 1000	Note	Q2 2021	Q2 2020	H 1 2021	H1 2020	2020
		Unaudited	Unaudited	Unaudited	Unaudited	Audited
Revenue		320804	271919	666 496	528 601	1315894
Cost of goods sold		$-200959$	-163 615	$-417815$	-320 832	-798389
Employee benefits expenses		$-42913$	-34024	$-102062$	-82 599	$-219294$
Depreciation and amortisation expenses		$-9108$	-7883	$-17720$	-15 686	$-33118$
Other operating expenses		$-37026$	$-33551$	$-75158$	-68 757	$-143491$
Total operating expenses		$-290005$	-239 072	$-612755$	-487 874	-1 194 292
Operating profit		30798	32847	53741	40727	121 602
Net financial income (+)/expenses (-)		$-1819$	$-3504$	$-4109$	$-7293$	$-14446$
Profit before tax		28 980	29344	49632	33 435	107 156
Income tax expense		$-6924$	$-7001$	$-11998$	$-8403$	$-25885$
Net profit (loss) for the period		22055	22 343	37634	25 0 32	81 271
Eaming per share (EPS)		1,06	1,08	1,82	1,21	3,92

Return on Equity

Good return on Equity (measured as adjusted net profit/average equity)

Consolidated statement of financial position

Note Amounts in nok 1000	Q2 2021	Q2 2020	H 1 2021	H 1 2020	2020
	Unaudited	Unaudited	Unaudited	Unaudited	Audited
Goodwill	118747	128006	118 747	128006	122 606
Other intangible assets	6310	6859	6310	6859	7356
Total intangible assets	125 057	134 865	125 057	134 865	129 962
Fixtures and fittings, office machinery and equipment	147050	129094	147050	129094	142778
Inventory	219258	192122	219258	192 122	208 160
Trade receivables	73891	51316	73891	51316	54386
Other receivables	13526	15 002	13526	15 002	28 25 1
Cash and bank deposits	65523	2838	65523	2838	94 080
Total current assets	372 198	261 278	372 198	261 278	384 877
Total assets	644 305	525 237	644 305	525 237	657617
Note Amounts in nok 1000	Q2 2021	Q2 2020	H1 2021	H 1 2020	2020
	Unaudited	Unaudited	Unaudited	Unaudited	Audited
Share capital	13011	13 011	13011	13 011	13011
Other Equity	150 169	106 297	150 169	106 297	112535
Total Equity	163 180	119308	163 180	119308	125 546
Deferred tax	44	676	44	676	43
Lease liabilities	19281	10702	19281	10702	17923
Other long term liabilities	0	30000	0	30000	0
Liabilities to financial institutions	185 000	205 000	185 000	205 000	185000
Total long term liabilities	204 325	246378	204 325	246378	202 966
Liabilitites to financial institutions	20188	1063	20188	1063	22702
Trade payable	102030	91334	102 030	91334	120798
Tax payable	30526	11928	30526	11 928	26518
Dividends payable	50000	0	50000	0	50000
Public duties payable	35 165	31 3 35	35 165	31 3 35	50559
Other short term liabilities	38891	23891	38891	23891	58528
Total short term liabilities	276 800	159551	276 800	159551	329 105
Total Equity and Liabilities	644 305	525 237	644 305	525 237	657617

Consolidated statement of cash flows

Note Amounts in nok 1000	Q2 2021	Q2 2020	H1 2021	H 1 2020	2020
	Unaudited	Unaudited	Unaudited	Unaudited	Audited
Cash flow from operations
Operating profit	30798	32847	53741	40727	121 602
Taxes paid	$-3995$	0	$-7990$	$-4509$	$-7990$
Depreciation and amortisation	9108	7883	17720	15 686	33 1 18
Change in inventory	13308	6615	$-12306$	12371	$-3605$
Change in trade debtors	$-10341$	$-4382$	$-22917$	$-13887$	$-13815$
Change in trade creditors	13821	17396	$-14146$	3593	29849
Change in other provisions and receivables	$-31174$	$-15562$	$-19982$	1816	10906
Net cash flow from operations	21525	44 797	$-5880$	55 798	170065
Cash flow from investments
Net capital expenditures	$-12829$	$-4847$	$-17058$	$-15328$	$-41570$
Net cash flow from investments	$-12829$	-4847	$-17058$	$-15328$	$-41570$
Cash flow from financing
New Loans	0	0	0	0	215800
Repayment of loans and interest	$-2614$	$-3504$	$-5619$	$-38526$	$-251109$
Net cash flow from financing	$-2614$	$-3504$	$-5619$	-38526	$-35309$
Cash and cash equivalents at the beginning of the period	59441	$-33608$	94080	894	894
Net change in cash and cash equivalents	6082	36 446	$-28557$	1944	93 186
Cash and cash equivalents at the end of the period	65523	2838	65523	2838	94 080

Consolidated statement of changes in equity

Amounts in nok 1000	Paid in	Other	Total
	Equity	Equity	Equity
January 1st. 2020	13011	81 265	94 276
Profit for January-June 2020	0	25 0 32	25 0 32
Balance at 30th. June 2020	13011	106 297	119308
Balance at 1st. January 2021	13011	112535	125 546
Profit for January-June 2021	0	37 634	37634
Balance at 30th. June 2021	13011	150 169	163 180